Shuaa Capital reports net loss of Dhs170m for Q2 2022

An asset management and investment banking company, Shuaa Capital, has announced its financial results for Q2 2022.

In the second quarter, Shuaa and its subsidiaries reported a net operating income of Dhs6m compared to Dhs24m in Q1 2022 primarily due to lower trading revenues.

The group reported a net loss attributable to shareholders of Dhs170m in Q2 2022, compared to a net income of Dhs6m in Q1 2022.

SHUAA Capital reports financial results for Q2 2022
شعاع كابيتال تعلن عن نتائجها المالية للربع الثاني من عام 2022https://t.co/S5dd61NE2z pic.twitter.com/DgyK7LrZAF

— SHUAA Capital (@SHUAA_Capital) August 11, 2022

In the second quarter, Shuaa delivered another set of strong recurring revenues of Dhs64m across all business segments of the group. The group’s asset management segment delivered a robust performance of Dhs33m of revenues, driven by the strong contribution from recurring management fees, which is expected to increase in the second half of the year with additional fee income from assets under management.

The group’s investment banking business reported revenues of Dhs3m due to lower advisory and trading revenues compared to the first quarter, but given a favorable deal pipeline, revenues in the second half of the year are expected to be higher.

Revenues from their corporate segment remained strong at Dhs28m despite increased market volatility, led by Shuaa’s robust trading business in Q2 2022. The cost-income ratio of 90 per cent in Q2 2022 is higher than the 73 per cent in Q1 2022 due to lower revenues. However, additional cost optimisation measures are expected to have an impact in the second half of 2022.

The group continues to focus on deleveraging with repayments of Dhs188m in H1 2022. Positioned to benefit from the UAE’s strong economic fundamentals and growth prospects

Fawad Tariq Khan, group CEO of Shuaa Capital, said: “Despite a challenging quarter, our core operating business remained resilient and delivered recurring revenues of Dhs64m across all business units. We have embarked on a group-wide exercise to streamline our business by addressing non-cash expenses and cost optimisation measures to position us for profitability in the future. We remain committed to providing innovative investment solutions to our clients, as evidenced by the global launch of Northacre and the increase in the number of managed funds our clients have access to.”